A Bulgarian national already serving a federal prison sentence for laundering millions of dollars in cryptocurrency has been hit with new charges after U.S. prosecutors accused him of orchestrating another crypto laundering scheme from inside prison. According to the U.S. Department of Justice, Rossen Iossifov allegedly conspired to move approximately $290,000 worth of cryptocurrency from a Kraken account that had already been ordered forfeited by a federal court.
The latest indictment underscores the Justice Department’s continued focus on enforcing court ordered crypto forfeitures and pursuing individuals who attempt to move digital assets after they have been seized.
Key Takeaways
- U.S. prosecutors have charged Rossen Iossifov with allegedly moving about $290,000 in court forfeited cryptocurrency while serving a prison sentence.
- The funds were reportedly withdrawn from a Kraken account and transferred through crypto exchanges and mixing services.
- Iossifov was previously convicted for laundering nearly $5 million tied to an international online auction fraud scheme.
- The new charges include conspiracy to commit money laundering, removing property to prevent seizure, and aiding and abetting.
- If convicted, Iossifov could face up to 25 additional years in prison.
New Indictment Centers on Seized Crypto
The Department of Justice announced that Iossifov, 53, appeared before the U.S. District Court for the Eastern District of Kentucky this week after prosecutors unsealed a new indictment against him.
According to the charges, the alleged scheme began in January 2024 while Iossifov was already serving a 111 month federal prison sentence. Prosecutors claim he worked with others to remove cryptocurrency that had been frozen under a court ordered forfeiture following his earlier conviction. Investigators allege the digital assets were transferred through several cryptocurrency exchanges and mixing services in an effort to conceal the movement of funds and prevent the U.S. government from taking possession of the assets.
The Justice Department has not disclosed how the Kraken account was accessed or whether authorities have recovered the cryptocurrency.
Justice Department Vows to Enforce Forfeiture Orders
Federal officials described the alleged transfers as a direct attempt to undermine a lawful court order.
Assistant Attorney General A. Tysen Duva said individuals who disregard court ordered forfeitures should expect additional criminal charges.
“Those who flout lawfully entered orders will be held accountable.”
The U.S. Secret Service, which investigated both the original case and the latest allegations, also condemned the alleged conduct.
Special Agent Robert Holman said:
“Iossifov’s deliberate attempt to remove and launder lawfully seized funds is a direct challenge to our justice system and a blatant disregard to his victims’ rights.”
Previous Conviction Involved International Fraud Network
Iossifov is no stranger to U.S. prosecutors. He was convicted in 2021 for his role in the Alexandria Online Auction Fraud Network, an international scheme that targeted more than 900 victims across the United States through fraudulent listings for vehicles and other expensive goods on online marketplaces, including eBay and Craigslist.
Authorities said Iossifov operated RG Coins, a cryptocurrency exchange based in Sofia, Bulgaria, that helped convert proceeds from the fraud into cryptocurrency and cash before distributing them to members of the criminal network.
Trial evidence showed that nearly $5 million was laundered through the exchange over a period of less than three years.
Following his conviction, the court ordered him to pay more than $2.6 million in restitution and surrender cryptocurrency connected to the operation. Those same forfeited assets are now at the center of the new criminal case.
Crypto Laundering Remains a Key Enforcement Priority
The latest indictment reflects the growing attention U.S. authorities continue to place on cryptocurrency related financial crimes.
Law enforcement agencies have increasingly pursued cases involving crypto mixers, cross chain transfers, and other techniques used to disguise the movement of illicit funds.
According to the Justice Department, its Computer Crime and Intellectual Property Section has secured convictions against more than 180 cybercrime offenders since 2020 and obtained court orders returning over $350 million to victims.
While prosecutors allege that Iossifov attempted to evade forfeiture through blockchain based transfers, the indictment remains an allegation, and he is presumed innocent unless proven guilty in court.
Conclusion
The new charges against Rossen Iossifov illustrate that federal authorities are extending enforcement efforts beyond initial convictions to include attempts to interfere with court ordered crypto seizures. If prosecutors prove their case, the alleged movement of forfeited cryptocurrency from a prison cell could result in decades of additional prison time.
The case also serves as another reminder that blockchain transactions remain subject to forensic investigation, particularly when they involve assets already under federal forfeiture orders. As cryptocurrency becomes increasingly integrated into global finance, regulators and law enforcement agencies continue to strengthen efforts to track, recover, and protect digital assets connected to criminal activity.
